Editor’s Note: This article was first published by GreenBuzz, an association that supports sustainability on regional and international levels through research, education and networking. The article was authored by Ken Fullerton, a former member of GreenBuzz, and originally appeared here.
Worldwide, heat waves account for the deaths of 12,000 people per year while exposure to high levels of air pollution causes up to three million deaths per year. Many of these deaths occur in large urban cities as an increasing number of the earth’s population are choosing to live in urban rather than rural locations.
The World Economic Forum (WEF) claims there is “One beautifully simple action that municipal leaders can take to reduce both extreme heat and air pollution: plant more trees.” It further claims that planting trees “Is a one-two punch of environmental action.” This is due to the fact that trees and other green vegetation are responsible for naturally cooling the air around but also because they act as filters and are capable of reducing particulate matter (PM) levels in the surrounding 30 metres by as much as 25%.
Planting trees, particularly in large urban centres, should be viewed as a low-cost solution that can lead to a reduction in greenhouse gas emissions as well as improved health levels of societies. A global investment of only $100 million could potentially provide as many as 68 million people with significant reductions in PM levels while also contributing to a 1-degree Celsius reduction in air temperature for 77 million people. Additionally, “An investment equivalent of $4 per person could save 11,000-36,000 lives annually and reduce adverse health effects for tens of millions of people.”
Where tree planting as a climate change reduction strategy really stands out is in ability to address both urban heat and air pollution. Other strategies such as industrial scrubbers, limits on car, bike and truck traffic and the use of light-coloured building materials are also good strategies that have an important part to play and can be adopted by municipal leaders but they only address urban heat or air pollution and not both simultaneously.
The economic, environmental and health actions of not acting now against rising temperatures and increased air pollution will continue to escalate the longer no action is taken. In 2016, the Organisation for Economic Cooperation and Development (OECD) estimated that “Outdoor air pollution could cause 6 to 9 million premature deaths a year by 2060 and cost 1% of global GDP – around USD 2.6 trillion annually – as a result of sick days, medical bills and reduced agricultural output, unless action is taken.”
The Nature Conservatory claims that by the middle of the 21st century two out of every three people worldwide will live, work and play in cities. As a result of this, heat and air pollution will increasingly constitute major health concerns which will have to be addressed. Not addressing them would result in other negative economic, environmental and health costs arising in the future. However, addressing urban heat and air pollution are not the only benefits that can arise from planting trees.
The WEF states that “They provide habitat for wildlife, reduce storm-water runoff, and sequester carbon from the atmosphere, which helps to mitigate climate change. There is also a growing body of research showing that exposure to trees and other vegetation has a positive effect on mental health, especially for children. All of these co-benefits speak to the wisdom of greater investment in trees and urban green infrastructure such as parks and rain gardens.”
However, planting trees alone will not solve the problems of rising temperatures, increased air pollution and climate change. Yet, they are certainly a critical piece of the puzzle and should be used as a strategy by all types of leaders, strategists and policy-makers worldwide. Strategies for planting trees can also be highly targeted and localised in order to improve the health and well-being of a particular city or town’s citizens.
Image courtesy of Flickr. Originally published by S&S on February 15, 2018.
Editor’s Note: This article was first published by the Environmental Defense Fund, an organization focusing on creating economical policies to support clean air and water; abundant fish and wildlife; and a stable climate. The article was authored by Shannon Cunniff and originally appeared here.
Even though it’s set to receive billions in settlement dollars after the 2010 Gulf oil spill, Louisiana will fall short of what’s needed to fully implement critical wetland restoration projects to better protect its fragile coast.
Rather than scaling back ambition, however, the state is trying a new and emerging procurement approach – pay-for-performance contracting – to stretch the dollars.
The state’s Coastal Master Plan has budgeted $50 billion over the next half century, to which the oil spill settlements will contribute about $15 billion. Here’s the trick: By tying compensation to contractors to specific, stated outcomes – rather than to just job completion – Louisiana should be able to save money and thus restore more of the coast sooner and more effectively.
Such tangible benefits help explain why outcome-based contracting is catching on in communities and states nationwide, all of whom struggle with budget challenges. And why it’s becoming a buzzword in procurement and sustainable investment circles.
From energy services, to healthcare to…
The idea that contractors and suppliers are rewarded based on outcomes and results has been around for some time in the healthcare industry – for example between insurers and medical suppliers who follow patient outcomes.
It’s also gained traction in the education sector where schools are contracting with energy services companies that promise savings on power bills. This will, in turn, pay for construction costs or services over time without burdening local taxpayers.
Even the federal government has used outcome-based contracting to reduce energy and water costs.
The fact that Louisiana is eyeing this contracting model for its massive coastal restoration project now takes pay-for-performance to a whole new level.
How performance contracting delivers
Natural infrastructure solutions, such as wetland restoration, are among more than 100 projects included in Louisiana’s master plan.
Traditional contracts may, for example, stipulate the placement of clean sediment in open water areas to a certain elevation and planting native wetland grasses a certain distance apart. Under such arrangements, contractors get paid for material and labor, but not necessarily for how well the product – in this case, the restored wetland – performs.
Outcome-based contracting, on the other hand, might instead consider whether the wetland has the desired biodiversity, for example, or whether it attracts nesting of endangered species. A clear set of objectives, and means for collecting data on the progress of selected indicators, help determine such outcomes.
Other outcomes under consideration may be whether the wetland is self-sustaining or slowing coastal erosion. Or whether it reduces flooding of nearby properties and slows storm surge, averting expensive damage.
Louisiana could save billions
Under some pay-for-performance models, the service provider may bring their own financing and insurance. This means the buyer doesn’t pay a dime until the project is completed and the outcome satisfactory.
Whether these contracts realize better outcomes at less public cost will depend on how the terms of contracts are defined, and how the service providers respond. It may take a few tries to find the optimal terms.
But pay-for-performance contracting could ultimately save a state such as Louisiana millions, if not billions, and bring out the best the private sector has to offer: expertise, speed and risk sharing.
Fletcher Forum: In a speech given at the U.N., you stated that climate change is a powerful weapon of mass destruction, and we were hoping that you could elaborate on how you see climate and climate control as security issues.
KGK: Absolutely. Climate and climate control are intertwined with security in every possible way. We’ve seen entire countries starting to disappear, small island countries. But even for Croatia as a coastal state, we’ve seen the level of the sea rising, and in Italy, across the Croatian coast, Venice is sinking, one of the reasons being also the rising levels of the sea because of the melting polar ice caps. Climate change is definitely one of the elements that will continue to contribute to the migratory waves that we’ve seen so far that consist of asylum seekers, people fleeing from war, destruction, terrorism, oppression, et cetera, economic migrants, but also people who will be running in search of a home to live once their countries disappear. So I believe that this is one of the security threats of the future that we have to start working on very firmly today. Croatia has signed and ratified the Paris Agreement, we will continue to stick not only to the provisions of the Paris Agreement, but will continue to do whatever is in our power to provide for climate control and for control of environmental pollution and the protection of the environment in Croatia. Our forests, for instance, are disappearing, especially the evergreen forests because of the acid rain that we get from the west, from other parts of Europe that are more developed and where there is more industrial pollution. So climate control is something that cannot be stopped by walls or wires or borders, it’s something that is our joint obligation for the future of mankind.
FF: Can you speak a little bit about “real” versus “imaginary?” Our theme for this semester for the print edition is the global battle for truth, so looking at all sides of different debates. A lot of problems that are racking the EU right now and similar institutions come down to these competing claims for truth. For example, the truth that Europe’s long history of violence or the EU’s continuing imperfection versus the truth that European integration has brought unprecedented stability, prosperity, democracy, et cetera. So how do you confront these competing claims, such as the ones stated, or others that come to mind.
KGK: It’s not always easy, but for me, European integration has absolutely been a very, very positive process that has truly brought Europe together. But we still see these differences in imaginary geography between the East and the West. And we need to erase that, in physical and all other terms. So, you still see that there is lack of an infrastructure, of energy, of transportation, and other infrastructure—and thus my Three Seas Initiative that has been embraced by twelve EU member countries. So we need to pull the continent closer together. It has been imperfect, it has had its setbacks, but I think that the accession process, or rather what I call the consolidation of Europe—because Europe will not be enlarging anywhere, it will be incorporating the areas that truly belong to the continent—is a natural process that will guarantee freedom, stability, and prosperity on the continent.
Of course, there will always be skeptics in our own country and in many other countries, there will always be push and pull factors, and unfortunately we’ve seen more pull than push factors lately. Brexit has been an event that has shocked us all, and we do respect the will of the people of the UK that they expressed in the referendum. We’ll be sorry to see the UK leave, but I hope that the UK will remain engaged, especially in the Euro-Atlantic structures, and this is also where we see the role of the United States, closely connected to the European continent to keep the peace, to keep the stability, and to keep the prosperity. Because the threats to security today are becoming so volatile, so unpredictable, and develop so fast that none of us can protect ourselves individually and, as I’ve said already, no walls, no razor wires, will protect us. It’s only collaboration and sharing of values, which often we forget about. And one of the basic ones, solidarity, is what will protect us from the dangers of the future.
Julian Rauter interviews Deacon Stone from Coalfield Development and Solar Holler about sustainable development in Appalachian coal country. Stone explains the practical challenges and vast opportunities that social, economic and energy innovation can bring to the local community. The following links are mentioned in the podcast:
Editor’s Note: This article has been published as part of S&S’s partnership with Brightest Young Minds (BYM), a 17-year-old non-profit company that aims to identify, connect and mobilize Africa’s most innovative young people.
Following the announcement of an official partnership agreement between Brightest Young Minds (BYM) and Harvard University’s Sense & Sustainability (S&S) platform, BYM alumni are being strongly urged to prepare articles for publication on S&S. This presents an excellent opportunity to the more than 1700 BYM alumni who are incredibly diverse in terms of their backgrounds, nationalities, education, expertise, skills and interests. In this article, Ken Fullerton gets some background and inspiration from S&S’s Editor-in-Chief Joseph Chatham on the sorts of topics that BYM alumni can write about.
Articles must be between 500 and 1000 words in length and should align with one or more of S&S’ five focus issues: Business & Economics, Energy & Technology, Health & Human Capital, Environment & Ecosystems and Regulation & Governance. Chatham comments that, “In selecting our focus areas, S&S deliberately sought to redefine sustainability away from the buzzword it has become and towards a more comprehensive, cross-disciplinary perspective prepared to address 21st century challenges.”
Under these focus areas, BYM alumni can decide to write about different aspects of the theme. It could be a particular policy, program or initiative that they are personally involved in, or they are supporting, or a combination of the two. It might be at a local or community level, a state or provincial level, national level or even an international or global level. With limited resources and a multitude of actors and organisations competing for funds and resources, it is important to efficiently address multiple issues. “One thing we’ve always worked to champion here at S&S is moving away from the traditional approach of focusing narrowly on certain aspects of, for instance, climate change or environmental management. Instead, we feel it’s critical to understand such issues holistically, across society, from community stakeholders and local officials to intergovernmental organizations and multinational corporations”, notes Chatham. By learning about the existence of other projects, programs or policies, others are able to potentially build on what has already been done, adapt their own programs to cater for their unique environments and maximise their impacts.
S&S’s mission acknowledges that, “The challenges of sustainable development are many – and urgent. The work of crafting lasting solutions, however, has only just begun.” The establishment of an official partnership between BYM and S&S reflects this statement but now needs to be developed further with multiple BYM alumni preparing articles, sharing their findings and helping others to learn from policies and projects that are both successful and unsuccessful. It is intended to encourage people and organisations to share their views and beliefs, get out of the silos in which they may operate in, and directly and indirectly support others. The need for increased partnerships is also reflected in Sustainable Development Goal (SDG) 17 which calls for ‘Partnerships for the goals.’ Commenting on partnerships, Chatham says, “For the past few decades we’ve seen immense growth in the number of sustainability–oriented organizations and governmental and corporate practices directed towards the same – but many of these efforts have been siloed, leading to duplicative or even conflicting policies. What this shows us, then, is that it’s not enough to have a sustainability-oriented platform without considering the roles and influences of similar actors, and that is what I believe Goal 17 draws attention to, and why the partnership between S&S and BYM is so important.”
With its focus on sustainability, S&S believes it important for article authors to extract and share important findings, learnings and lessons. If others are able to use another person, organisation and/or government’s experiences and findings to improve their own work, increase their impacts or adapt policies or programs to ensure they are more efficient as a result of learning from others on S&S this is hugely beneficial. Chatham strongly supports this approach and believes, “This really is key – consider, as an example, how much is needlessly lost when an organization devotes substantial time and resources to addressing an issue another organization has already solved. Now, there is always the question of who gets the credit, but I think at some point we have to realize how much more we can accomplish working together.”
Together, BYM and S&S look forward to receiving article contributions from BYM’s diverse alumni network spread across South Africa, the African continent and other parts of the world. By sharing information and learning from one another, both organisations seek to play a small role in helping make the world a more sustainable place. Chatham sums this up by stating, “More and more individuals, corporations and governments around the world are waking up to the benefits of sustainability. During this critical period, it’s up to organizations like BYM and S&S to help build bridges and connect like-minded leaders, and by working side-by-side we can accomplish more than either of us could alone. In pursuing our shared goal, S&S is excited to partner with BYM and looks forward to a rewarding collaboration, both for our respective organizations and, most importantly, for our readers.”
Editor’s Note: This is the second of two articles examining the importance of phrasing in climate policy making and how changing that phrasing can help bridge today’s political divides. Part 1 can be found here.
Climate change was once a bipartisan policy goal, now marred by Big Oil in politics. A recent example of this includes the U.S. pulling out of the Paris Agreement, reinforced at COP23 in Bonn in November 2017. In the U.S., government mandated climate action requires that individuals use the institutional framework of electing members of Congress to represent true public opinion, especially in order to override Big Oil ‘donations’ to congressional campaigns. Successful climate policy requires that individuals not only believe that climate change should be addressed by the government, but prioritize it in their policy preferences and use the best tool we have to bring it to the forefront of congressional affairs: the voting process. While it may seem that politicians influence the public, American governmental institutions are designed so that public opinion drives policy decisions in Congress. Congressmen and women, like any other working citizens, wish to appease their ‘clients’ or ‘constituencies’ in order to maintain their jobs. While the Koch brothers may be a part of Congress’ constituency, they are not the only key players; congressmen and women also depend on the validation of the greater American public in order to keep their positions. We should thus appeal to the fundamental design of American institutions to our Earth’s advantage and influence the public into prioritizing climate policy, so they push for congressional action. Perhaps the best way for the Republican constituency to prioritize climate policy, specifically, is to appeal to their fundamental ideas, beliefs, and values via rephrasing climate change in the ‘conservative vernacular.’
Before rephrasing climate change terminology, it is important for policy makers and the media to understand their platform and legislative priorities. The conservative ideology is primarily based on limited government influence and greater individual freedoms. In terms of economics, conservatives or conservative-leaning individuals believe that wages should be set by the free market and push back against progressive tax increases. Their view of government regulation is influenced by their view on economics: they believe that government regulations deter job growth and free market capitalism. Many socially and fiscally conservative Republicans work in the oil or coal industries, or are small business owners and heads of large industries. To appeal to these conservatives, climate change terminology must be relevant to economic growth and the free market, whilst shying away from phrasing that explicitly addresses additional taxes or strong federal regulation.
On February 24th, 2017, in a bipartisan panel arranged by Berkeley Energy & Resources Collaborative at the University of California, Berkeley, Debbie Dooly, the founder of the Green Tea Coalition and Conservatives for Energy Freedom, advised that environmentalists, business owners, and government officials should focus on promoting green jobs for economic growth and renewable energy as a means of saving on utilities. She explained how simple language tools can help policy makers achieve some level of bipartisanship based on word choice. Dooly provided insight on certain trigger words such as “tax” in “carbon tax” that conservatives respond to negatively. She went on to explain that while policy diction may not be intentionally biased, individuals’ responses to certain words can distract from the original aim of the policy itself. If liberals are drafting policy that they would like conservatives to be responsive to, using phrases like “remediation fund” would be received far better than those like “carbon tax”.
Like Dooly, Mayor Dale Ross of Georgetown, Texas is a pro-renewables Republican. He explains how a majority “red city like Georgetown, such a conservative place, was one of the first cities in the country to be powered 100 percent by renewable energy.” As city leaders stated in an interview with NPR, in Georgetown the debate over renewables never mentioned climate change. Ross says that Georgetown’s decision was fueled by “love of green-green rectangles (dollar bills) . . .” (NPR). Georgetown city managers realized that wind and solar power are more predictable and that their prices do not fluctuate like oil and gas. Thanks to its transition to solar and wind, Georgetown was able to negotiate contracts with renewable energy companies for the next 25 years, and know exactly what the bill is going to be. NPR’s Ari Shapiro explains how “that’s especially appealing in a place like Georgetown where a lot of retirees live on fixed incomes.” By changing the conversation from “climate change” to “smart investing”, environmentalists and small business owners alike are benefiting from a renewables-based energy transition in Georgetown, Texas.
Many climate change related articles also have a tendency to throw the oil and coal industries, along with their workers, under the bus. Many oil and coal workers are conservative and may feel threatened by aggressive rhetoric against their livelihoods. Not only can it put their jobs in jeopardy, but also antagonize them by labeling them enablers of pollution. Posing coal as a thriving industry already puts coal workers at a disadvantage, especially when retraining programs like those developed by the 2016 Clinton campaign can help coal workers make their way into a thriving market for renewable energy, or even more profitable industries. If policy makers and the mainstream media focus more on the transition to renewables as a means of competition in the global market for energy, with emphasis on conservative ideals like the invisible hand and laissez-faire, along with the waning profitability of the coal industry, we may have a greater chance of appealing to the conservative base to influence congress to prioritize climate policy and make mitigation efforts successful.
Rephrasing climate change or “weather extremes” terminology to match the policy concerns of either political party can help remind us that we’re all working to achieve the same goal of building and sustaining a better world. We must ensure that our rephrasing does, however, address the same concepts – albeit via different means of persuasion. Maybe all policy makers need is a political thesaurus . . .
Image courtesy of Flickr. Originally published by S&S on January 30, 2018.
Editor’s Note: This article has been published as part of S&S’s partnership with Brightest Young Minds (BYM), a 17-year-old non-profit company that aims to identify, connect and mobilize Africa’s most innovative young people.
South Africa is a country largely recognised as having a dichotomy of economies. On one hand, it is often touted as being the gateway to Africa, containing Sandton (Johannesburg), the continent’s richest square mile. On the other hand, it is a place where 9.2% of the population are still without access to clean running water and 14.6% lack access to electricity. Coupled with these staggering statistics is the high cost of mobile data – a seemingly ubiquitous consumable in the modern world – which studies have shown results in 50% of rural South Africans not using the Internet. In fact, it has been shown that South Africans pay some of the highest prices globally for mobile data, almost guaranteeing low usage in rural communities where budgets are already spread thin with the cost of household necessities. However, all is not as hopeless as it seems for the 6,000-person remote community of Mankosi in the Eastern Cape province of South Africa.
Situated 60 kilometres from the nearest city, Mankosi is a community beset by the unemployment that is rife throughout the rest of the country. This translates to an inherent need for financially-sustainable solutions to the many problems facing the community. Enter the Zenzeleni Networks Project, a unique Internet Service Provider (ISP) in South Africa’s market owing to its registered not-for-profit element which works directly with the community and co-operatives therein to deliver its services. This model has proven to be successful in both the developed and developing contexts of global economics, with successful initiatives seen in Spain, Mexico and Zambia.
Zenzeleni, which translates to “do it yourself” from isiXhosa (one of South Africa’s 11 official languages), is a project that envisions the community of Mankosi as not looking for a hand-out, but rather for a hand-up – and it has started off in the best way. In 2012, a senior researcher from the University of the Western Cape proposed a plan for a mesh networking infrastructure to community leaders in Mankosi to get the community involved, as the plan was to have the community members take ownership of running the network. With this plan accepted by the elders in Mankosi, the team got to work.
As the community runs all aspects of the project themselves, all revenues stay in the community, with the co-operatives and residents themselves responsible for making decisions as to how to spend the money they receive. This, for example, has resulted in the issuing of small-scale loans for residents to set up small businesses. While current revenues are relatively low when compared to the corporate ISPs in the country, they are expected to grow to levels where the co-operatives will be able to hire individuals to maintain the growing network. Critical to this revenue growth, especially in these early stages, is the licence exemption provided by the Independent Communications Authority of South Africa (ICASA). This exemption allows Zenzeleni to offer its services and run its infrastructure without adding fees, meaning that the major expenses incurred come from purchasing the backhaul Internet connectivity, which Zenzeleni is able to get at wholesale prices. All this translates into lower costs for the community, with free local calls and calls to other networks 50% of the normal price – and data costing just one tenth of other ISPs’ price. Zenzeleni really is making being connected a service that all can enjoy.
Beyond the increased connectivity this project creates is an innovative approach to the problem of not being connected to an electric grid. All nodes within the mesh network are solar powered, thereby creating an effective and environmentally-friendly solution, while also creating locations for Zenzeleni customers to power their devices – such as cell phones – and the houses that host the nodes within the community.
It seems that Brand South Africa’s slogan of “Inspiring new ways” is a lived experience in Mankosi. Only time will tell if this new and innovative way of thinking in this rural Eastern Cape community can be replicated in other parts of the country. At present, though, not only is Zenzeleni helping to connect more people and communities to the Internet, it is enabling them to physically use the services simply because they can afford to do so.
Image courtesy of Flickr. Originally published by S&S on January 25, 2018
Editor’s Note: This article was first published by the Environmental Defense Fund, an organization focusing on creating economical policies to support clean air and water; abundant fish and wildlife; and a stable climate. The article was authored by Sean Wright and originally appeared here.
Investor interest in climate-related financial risk is at an all-time high. So it makes sense for shareholders and lenders to increasingly be voicing concern over methane leaks.
In December 2017, a group of 225 investors with more than $26 trillion in assets joined a new initiative with several partner organizations to strengthen climate-related financial disclosures among the world’s largest corporations.
It followed a year during which United States shareholders filed at least 17 methane resolutions with companies across the natural gas value chain – and leading companies such as Exxon subsidiary XTO Energy responded with new plans to manage methane emissions.
Clearly, methane – which accounts for 25 percent of Earth’s warming today – is on investors’ minds.
When it comes to operators, however, it’s a tale of two industries where a few show strong leadership and others lag woefully behind. This could have major financial implications for the oil and gas industry going forward.
Large investors wield their power
The wide gap between methane doers and non-doers will come into full display as leading investors increasingly tilt their portfolios toward businesses that follow environmental, social and government principles, known as ESG. This trend will create new winners and losers, and possibly shuffle market shares in the already-volatile oil and gas world.
Just as large institutional investors such as State Street are now steering publicly-traded companies to include women on their boards to boost business performance – and BlackRock, Vanguard and Fidelity vote for shareholder proposals pushing for climate change disclosure – oil and gas operators must reckon with the fact that methane risks are central to investors.
Methane management, with its cost-effective and easily implemented solutions, will be viewed as a near-term proxy for effective risk management. Oil and gas companies, in other words, need to take action to keep spigots for financing wide open and to remain competitive in a world that is quickly shifting to cleaner, and increasingly cost-effective, forms of energy.
Which makes it surprising that more companies don’t.
35% of surveyed operators ignore risks
A recent report for which I served as a reviewer, Disclosing the Facts, included 13 new and detailed survey questions to leading oil and gas companies about methane management. The results were startling considering recent high-profile methane accidents and how much methane, the main ingredient in valuable natural gas, is going to waste.
Of the 28 companies that participated in the study, 35 percent scored fewer than 4 points – meaning, they had yet to grasp that methane leaks and emissions pose a significant reputational and financial risk to their business. About 20 percent scored 1 point or less.
But there were also several companies that came out on top – Apache, BHP, Southwestern, ConocoPhillips, Hess and Shell – after showing they are taking concrete action to reduce emissions from their oil and gas operations.
Still, all but four had yet to put in place quantitative emission reduction targets. Where will the many companies that are now resting on their laurels be one, five or 10 years from now?
Investors demand stronger policies
Investors today are not content only to engage at shareholder meetings. They’re also trying to affect state, national and international policymaking on methane.
In 2017, investors testified at U.S. Environmental Protection Agency hearings to stop attempts to delay federal methane rules. Internationally, investors co-signed a letter to Canadian policymakers to strengthen proposed methane rules in that country to better protect investors’ stake in the oil and gas industry.
All this signals that the risk of ignoring methane problems in the industry today is too great to ignore. As the pressure continues to build, operators should only expect investor engagement – and the spotlight on their operations – to grow.
The question for these companies now is simply whether or not they plan to stay ahead of this race.
Editor’s Note: This article was first published by the Environmental Defense Fund, an organization focusing on creating economical policies to support clean air and water; abundant fish and wildlife; and a stable climate. The article was authored by Dick Munson and originally appeared here.
Talk about a disruptive technology. Blockchain – the secure, decentralized and highly efficient platform for keeping track of infinite transactions – could soon be revolutionizing America’s electricity markets, too.
Anyone wondering just how a “peer-to-peer power grid” works can look to LO3’s microgrid project in Brooklyn, New York. It’s where 60+ residents are now trading electricity they generate from solar panels to neighbors in need of extra power, via a simple app.
Or to Europe, where companies are rolling out blockchain technology to enable energy trading between utilities, between residential customers, or simply to help owners of electric cars charge up their vehicles with their cell phones.
Investors smell opportunity, too. Technology giant Siemens just committed an undisclosed amount to LO3’s startup platform, signaling what’s ahead: The powerful blockchain tool may soon change how consumers buy and sell energy, transforming electricity markets as we know them today.
22 million users and counting
Virtual energy markets are built on top of existing infrastructure to track power that is produced and bought, using blockchain to account for such transactions. It’s the same technology that the wildly popular bitcoin cryptocurrency is using, and which is now transforming the world’s financial markets – while also making inroads in insurance industries, political systems and philantrophies worldwide.
Nearly 22 million people use bitcoin today to make electronic peer-to-peer transactions without an intermediary bank, according to Blockchain, the world’s largest provider of digital bitcoin wallets. That’s twice as many as a year ago.
Will peer-to-peer energy trading see a similar growth curve?
Utilities face technology wake-up call
As distributed, decentralized energy resources such as batteries and solar panels continue their rapid growth, some analysts believe the market for blockchain applications could actually be larger in the energy sector than for financial services.
This poses new challenges for entrenched power companies. Some may lose revenue over blockchain, while others embrace the technology as part of their business model.
How it’ll all play out here in the United States will depend, in part, on regulators, but also on consumer demand and evolving market trends.
As grid modernization and new utility business models gain traction, disruptive technologies such as blockchain point to innovative approaches for delivering efficient, reliable, affordable and clean energy – all of which can be strong selling points as we’ve seen across the pond.
Europeans take the lead
In Europe, where utilities have less market control and distributed generation is accelerating, peer-to-peer and business-to-business energy trades are getting significant attention:
German electric utility RWE is testing a blockchain application for charging electric vehicles.
Vattenfall AB, the largest Nordic utility, plans a blockchain app that would allow its customers to buy and sell power independently of the utility.
Austria’s Wien Energie is participating in a blockchain trial focused on energy trading with two other utilities.
Finland’s Fortum plans to let consumers control appliances over the internet in connected homes, using blockchain.
These are just a few examples, and there are developments in other parts of the world as well.
Energy trading made safe and secure
Rather than being stored on a central server, peer-to-peer transactions are replicated across a number of computers, creating a data store that records exchanges in almost real time. To guarantee secure transactions and prevent hacking, the authenticity and identity of participants are maintained through cryptography and digital signatures.
And because blockchain technology is decentralized and accessible from multiple locations, trades of electrons – as with bitcoin funds – can’t be frozen, withheld, seized or taken.
Who will take most advantage of blockchain as it enters American electricity markets remains an open question for now. But count on this: LO3 and Siemens, first out of the gate, will have followers very soon.
Editor’s Note: This article was first published by the Environmental Defense Fund, an organization focusing on creating economical policies to support clean air and water; abundant fish and wildlife; and a stable climate. The article was authored by Jason Mathers and originally appeared here.
Tesla’s much-anticipated electric semi-truck is garnering attention for its futuristic look and zero-emission promise – and it’s part of an innovation trend that is changing the future of trucking, with implications for entire supply chains.
United Parcel Service, Anheuser-Busch, Walmart, PepsiCo and J.B Hunt are among the companies rushing to secure orders of Tesla’s trucks, which are expected to be in production in 2019.
All-electric trucks can bring tangible benefits not just to truck owners, whose conventional vehicles can consume more than $60,000 worth of fuel a year, but also to their customers.
Fuel has long been a top cost for trucking, accounting for nearly 40 percent of the per-mile cost. Because fuel bills are passed on to companies that hire trucks to get their goods to market, electric trucks can thus promise businesses significantly lower and more stable operating costs.
For the business community as a whole, savings could be in the billions.
Truck manufacturers hurrying to grab market share
Indeed, Tesla is just one among a number of large auto manufacturers that are now investing in electricity-powered trucks because they see a robust, long-term market for such products and clear bottom-line benefits:
Daimler recently launched a fleet of urban delivery trucks in New York City. The trucks, which have a 60-mile range, are set for scaled production in 2019. Daimler is also expected to unveil a larger class 7 electric truck.
New Flyer, BYD and Proterra are all taking orders for electric buses. A dozen major cities, including Los Angeles, have committed to buying buses.
Along with the economic benefits, medium and heavy-duty trucks provide major health and environmental benefits for neighborhoods and communities nationwide.
Trucks move about 70 percent of freight in the United States today, and while only accounting for 10 percent of highway miles traveled, they are a major source of harmful nitrogen oxide and particulate matter – especially in cities and towns along congested truck routes.
Electric trucks also offer significantly lower lifecycle greenhouse gas emissions at a time when nations and states are looking for new technology solutions to meet their carbon reduction goals.
Long-haul capability: Key to this market shift
Most electric truck announcements so far have been for urban or regional vehicle use where buses and delivery trucks don’t need to drive very far and follow predictable driving patterns in areas with charging stations.
As the market for electric trucks grows, dense cities and communities will be the first to benefit from the reduction in local air pollution – but as battery technology continues to improve, look for more electric trucks to drive long-distance.
This will be the ticket to the major disruption of the truck industry that many experts believe will come in just a few years, and with benefits multiplying across our economy.
It’s a time of great innovation in the truck industry, and while there is still more we can and must do to make conventional diesel trucks cleaner and more efficient, electric trucks are coming our way.
As eye-catching as the Tesla Semi launch was, it’s just the beginning.
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